The Hancock-Henderson Quill, Inc.

FY 11 Budget Summary

by: Ralph Grimm, WC Supt.

At their regularly scheduled September 15, 2010, meeting, the West Central CUSD #235 Board of Education approved the Fiscal Year 11 (FY 11) district budget.

Our district budget year runs from July 1 through June 30. That is why it is considered a fiscal year budget and not a calendar year budget. I wanted to provide our stakeholders with some basic facts about the district and the FY 11 budget. Please consider the following:

General Information

• The State of Illinois is having significant financial problems. Current estimates of the states total debt to a multitude of providers and pension systems is approximately $13 Billion Dollars.
• This obviously has a huge impact on the states ability to pay its bills. We have felt the effect of this. The state of Illinois ended up on June 30 (the end of our fiscal year) OWING District 235 $769,728.
• The district has 177 full and part time employees as of September 10, 2011. Of that total, 32 are part-time. Of the 32 part-time employees, 21 are bus drivers.
• In spite of being owed $769,728, the district ended last year with significant fund balances. As of June 30, 2010, the district had approximately $7.2 million dollars in the bank for all funds. This figure includes $1,540,000 of local property tax money that was distributed in June of 2010 and must be included in the last years figures. Our anticipated fund balance on June 30, 2011 is projected to be approximately $6.5 million dollars.
• This years budget calls for revenues of $9,393,785 and expenditures of $10,197,693.
• The district budget for this current school year 2010-11 is a deficit budget by approximately $800,000. There are many reasons for this deficit as will be explained below.
• This budget DOES NOT include the anticipated dollars from the federal Education Job Funds Bill. The Education Job Funds Bill is the bill that President Obama signed in early August that provided funds to school district throughout the country to rehire laid off teachers and support personnel. The expected district allocation amount is approximately $280,000. These funds will be used to offset salary expense.
• This budget uses a General State Aid (GSA) Foundation level of $5800 per student instead of the state authorized $6119 per student. This is one of the amounts that the state guarantees to be paid to a local district per student. The Foundation Level is one component of the school funding formula which is the way the state of Illinois determines how much money to give to schools each year to operate. It is one of several local factors that go into the formula.

I am not convinced of the states ability to honor the $6119 Foundation Level. I believe this to be true because in the legislation authorizing the $6119 Foundation Level, it was clearly spelled out for the first time ever, that the state board was authorized to "prorate" that amount if sufficient funds were not available. The difference in GSA between a $6119 foundation level and a $5800 Foundation Level is $296,963. We certainly hope the state will be able to honor the higher Foundation Level. If the district actually receives the job funds bill money and the higher level of GSA as outlined above, the anticipated deficit would be closer to $200,000 for the year.

• This budget assumes we will receive TWO transportation payments from the state. We should receive six payments from the state this year: 2 from last year and 4 from this year. As of this date, we have received ONE transportation payment from the state and it has been identified as the third payment from last year. That payment equaled $233,912. I expect to receive one more payment in that amount (the fourth payment from last year) and that is all that I have budgeted in terms of revenue from the state for this year.

As for this year's payments, our reimbursement amount should be $558,068. That figure represents 80% of our claimable expenses from last year which is to be reimbursed to us this year. However, we have been notified that we will receive only 57% of our 80% reimbursement for this year. That reduces the figure above to $318,397, a difference of $239,671. I fully expect to not receive any of the $318,397 this year and the state will then make that money become our allotment for next year.

• This budget also assumes that we will receive approximately $275,000 of Early Childhood money. We did not receive any of last years Early Childhood money from the state. We have received approximately half of this money this year. I anticipate receiving the other half of that money by December 31, 2010. I am not including any additional money for the Early Childhood program in this budget. The state has indicated that this year's allotment for the Early Childhood program should be approximately $280,000. I would anticipate receiving that money in next year due to the state being at least six months behind in paying their bills.
• Last year's costs for employee salaries and benefits were $6,157,470. For the 2010-11 school year, our budgeted costs for employee salaries and benefits are $6,189,015. Due to the reductions made in staff through lay-offs and retirements, we were able to decrease our number of employees and have only a .51% increase in our total costs in this area.
• In this years budget we are also reducing anticipated expenditures. The budget that was approved in September of 2009 called for total expenditures of $10,798,568. Our actual expenditures for last year were $9,632,212. Our budgeted expenditures for this year are $10,197,693. This is a difference of $600,875 from the last year's budget to this year's budget. This is a 5.56% decrease from one budget year to the next.
• This budget also assumes full payment of all mandated categorical reimbursements. We have received full payment of the mandated categoricals from FY 10. Mandated categoricals are reimbursement amounts that we receive from the state for providing certain services to some of our students. For example, we receive additional funding from the state for each special ed teacher that we employ to deal with our special needs students.
• This budget includes an additional $84,000 of Federal Title I money. This is extra money above and beyond what we would normally receive based on the Title I funding formula. These dollars are available to us because some school districts did not apply for all of their Federal Title money last year. We received this additional money because we met several criteria the last of which was having a school being designated as an Illinois Spotlight School. If the elementary school had not earned this designation for their outstanding academic performance, we would not have received these additional funds.
• This budget relies more heavily on local money than in past year. This is due partly because several of our federal and state grant allocations have decreased or been eliminated.
• This budget includes only $175,000 of General State Aid being deposited into the Building Fund. We have been depositing $350,000 of GSA into the building fund for the past several years. The Building Fund is operating this year at a significant deficit and this is something that will need to be addressed in the future.
• We are depositing $150,000 of General State Aid in the Transportation Fund this year. This is the first time that I